Difference Wiki

Purchase Requisition vs. Purchase Order: What's the Difference?

Edited by Sawaira Riaz || By Sumera Saeed || Updated on November 28, 2023
A purchase requisition is an internal request for goods or services, while a purchase order is an official order to a supplier to provide those goods or services.

Key Differences

A purchase requisition is a document generated within an organization to notify the need for goods or services. It starts the purchasing process. In contrast, a purchase order is a formal and binding agreement with a supplier to purchase the specified goods or services under agreed-upon terms.
Sumera Saeed
Nov 25, 2023
Purchase requisitions are used internally to seek authorization for a purchase. They often require managerial approval. Purchase orders, on the other hand, are external documents sent to vendors, indicating official confirmation to proceed with the order after internal approvals have been obtained.
Sumera Saeed
Nov 25, 2023
The purpose of a purchase requisition is to request authorization and ensure budget availability. It's a control mechanism. A purchase order serves as a legal agreement with the supplier to deliver the requested items, indicating quantities, prices, and delivery terms.
Sawaira Riaz
Nov 25, 2023
In the procurement cycle, purchase requisitions come first, as they initiate the need for a purchase. Once approved, they lead to the creation of a purchase order, which is the next step in the procurement process, formalizing the purchase with the vendor.
Aimie Carlson
Nov 25, 2023
Purchase requisitions are part of the internal record-keeping, helping in budgeting and auditing. Purchase orders, once accepted by a supplier, become a contractual obligation, and are crucial for legal, financial, and inventory records.
Janet White
Nov 25, 2023
ADVERTISEMENT

Comparison Chart

Nature

Internal document
External document
Sumera Saeed
Nov 25, 2023

Purpose

Request for approval
Confirmation of order
Sumera Saeed
Nov 25, 2023

Issued By

Employee or department within organization
Purchaser to the supplier/vendor
Sumera Saeed
Nov 25, 2023

Represents

Internal need and authorization request
Official commitment to buy
Aimie Carlson
Nov 25, 2023

Role in Procurement

Initiates purchase process
Finalizes purchase agreement
Sumera Saeed
Nov 25, 2023
ADVERTISEMENT

Purchase Requisition and Purchase Order Definitions

Purchase Requisition

A document to validate the necessity and budget availability for a purchase.
The manager approved the purchase requisition for the marketing materials.
Janet White
Nov 14, 2023

Purchase Order

A binding legal document between buyer and seller.
Upon receiving the purchase order, the vendor began processing the shipment.
Sumera Saeed
Nov 14, 2023

Purchase Requisition

A precursor to a purchase order in the procurement process.
Before issuing a purchase order, the company requires a completed purchase requisition.
Sawaira Riaz
Nov 14, 2023

Purchase Order

A formal agreement with a vendor to supply specified goods or services.
The company sent a purchase order to the supplier for new office chairs.
Sawaira Riaz
Nov 14, 2023

Purchase Requisition

A formal request for goods or services within an organization.
The IT team sent a purchase requisition for software upgrades.
Harlon Moss
Nov 14, 2023

Purchase Order

A document confirming the terms of the transaction.
The purchase order included delivery dates and payment terms.
Sumera Saeed
Nov 14, 2023

Purchase Requisition

A document requesting approval for a planned purchase.
The department submitted a purchase requisition for new computers.
Sumera Saeed
Nov 14, 2023

Purchase Order

An official confirmation of an order to a supplier.
The purchase order detailed the quantity and price of the laptops ordered.
Sumera Saeed
Nov 14, 2023

Purchase Requisition

An internal control mechanism for spending.
To control expenses, all office supplies must be ordered through a purchase requisition.
Sumera Saeed
Nov 14, 2023

Purchase Order

An external procurement document following internal approval.
After the budget approval, a purchase order was issued for the training services.
Sumera Saeed
Nov 14, 2023

FAQs

Who typically creates a purchase requisition?

Employees or departments within an organization needing goods or services.
Sumera Saeed
Nov 25, 2023

Can a purchase requisition be used to order goods directly?

No, it's for internal approval and doesn't place an order with suppliers.
Sumera Saeed
Nov 25, 2023

Is a purchase order legally binding?

Yes, it becomes a binding contract once accepted by the supplier.
Harlon Moss
Nov 25, 2023

Can a purchase requisition be modified after submission?

Yes, but it often requires a new approval process.
Janet White
Nov 25, 2023

How does a purchase order differ from a purchase requisition?

A purchase order is a formal agreement with a supplier, while a requisition seeks internal approval.
Sawaira Riaz
Nov 25, 2023

What happens after a purchase requisition is approved?

It usually leads to the creation of a purchase order.
Sumera Saeed
Nov 25, 2023

Can a purchase requisition be declined?

Yes, if it's deemed unnecessary or over budget.
Aimie Carlson
Nov 25, 2023

What is a purchase requisition?

It's an internal document requesting authorization for a purchase.
Sumera Saeed
Nov 25, 2023

What information is included in a purchase order?

It includes details like quantities, prices, and delivery terms.
Janet White
Nov 25, 2023

What happens if a supplier doesn’t comply with a purchase order?

It may lead to legal disputes as it’s a binding agreement.
Janet White
Nov 25, 2023

Does every purchase need a purchase requisition?

Policies vary by organization, but it's generally recommended for significant purchases.
Harlon Moss
Nov 25, 2023

Are purchase orders necessary for all businesses?

While not mandatory, they are recommended for clear, legal procurement processes.
Harlon Moss
Nov 25, 2023

What role does a purchase order play in inventory management?

It helps in tracking orders and managing inventory levels.
Harlon Moss
Nov 25, 2023

Are purchase orders public documents?

No, they are commercial documents between buyer and supplier.
Sumera Saeed
Nov 25, 2023

Who approves a purchase requisition?

Typically, a manager or someone in a supervisory role within the organization.
Sumera Saeed
Nov 25, 2023

Does a purchase requisition involve financial commitment?

No, it’s a request for approval, not a financial commitment.
Harlon Moss
Nov 25, 2023

Is a purchase order valid without a vendor’s acceptance?

No, it requires acceptance to be legally binding.
Janet White
Nov 25, 2023

How do digital systems affect purchase requisitions and orders?

They streamline and automate the approval and ordering processes.
Aimie Carlson
Nov 25, 2023

Can a small business operate without purchase orders?

Yes, but it increases the risk of miscommunication and disputes.
Sumera Saeed
Nov 25, 2023

What is the importance of a purchase requisition in budgeting?

It ensures expenses are pre-approved and budgeted.
Harlon Moss
Nov 25, 2023
About Author
Written by
Sumera Saeed
Sumera is an experienced content writer and editor with a niche in comparative analysis. At Diffeence Wiki, she crafts clear and unbiased comparisons to guide readers in making informed decisions. With a dedication to thorough research and quality, Sumera's work stands out in the digital realm. Off the clock, she enjoys reading and exploring diverse cultures.
Edited by
Sawaira Riaz
Sawaira is a dedicated content editor at difference.wiki, where she meticulously refines articles to ensure clarity and accuracy. With a keen eye for detail, she upholds the site's commitment to delivering insightful and precise content.

Trending Comparisons

Popular Comparisons

New Comparisons